HB5929 98TH GENERAL ASSEMBLY

LRB098 20290 HLH 55723 b

98TH GENERAL ASSEMBLY
State of Illinois
2013 and 2014
HB5929

Introduced , by Rep. Mary E. Flowers

SYNOPSIS AS INTRODUCED:

New Act

Creates the Financial Transaction Tax Act. Beginning September 1, 2014, imposes a tax on the privilege of engaging in a financial transaction on any of the following exchanges or boards of trade: the Chicago Stock Exchange, the Chicago Mercantile Exchange, the Chicago Board of Trade, and the Chicago Board Options Exchange. Provides that the tax is imposed at a rate of $1 per contract for all transactions for which the underlying asset is an agricultural product and $2 per contract for all other contracts. Provides that the term "financial transaction" means a transaction involving the purchase or sale of a stock contract, futures contract, swap contract, credit default swap contract, or options contract, but does not include a transaction involving securities held in a retirement account or a transaction involving a mutual fund. Effective immediately.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 1. Short title. This Act may be cited as the Financial Transaction Tax Act.

Section 5. Tax imposed; definitions.

(a) Beginning September 1, 2014, a tax is imposed on the privilege of engaging in a financial transaction on any of the following exchanges or boards of trade: the Chicago Stock Exchange, the Chicago Mercantile Exchange, the Chicago Board of Trade, and the Chicago Board Options Exchange. The tax is imposed at a rate of $1 per contract for all transactions for which the underlying asset is an agricultural product and $2 per contract for all other contracts. The tax shall be paid by the trading facility or, in any other case, by the purchaser involved in the transaction.

(b) A tax imposed under this Act, and all civil penalties that may be assessed as an incident thereof, shall be administered, collected, and enforced by the Illinois Department of Revenue, and commodity brokers shall register with the Department, in the same manner as required under the Retailers' Occupation Tax Act insofar as may be applicable. The Department of Revenue has full power to administer and enforce this Act, to collect all taxes and penalties due under this Act, to dispose of taxes and penalties so collected as provided in this Act, and to determine all rights to credit memoranda arising on account of the erroneous payment of tax or penalty under this Act. The Department of Revenue shall pay over to the State Treasurer all taxes and penalties collected under this Act for deposit into the General Revenue Fund.

For the purpose of this Act, "financial transaction" means a transaction involving the purchase or sale of a stock contract, futures contract, futures options contract, swap contract, credit default swap contract, or options contract, but does not include a transaction involving securities held in a retirement account or a transaction involving a mutual fund.

Section 10. Rules. The Department shall adopt administrative rules to implement and administer this Act. Initial rules may be adopted as emergency rules.

Section 15. Interstate commerce exemption. No tax is imposed under this Act upon the privilege of engaging in a business in interstate commerce or otherwise when the business may not, under the Constitution and statutes of the United States, be made the subject of taxation by this State.

Section 99. Effective date. This Act takes effect upon becoming law.